Epic Games CEO: “HTC Vive is outselling Oculus Rift 2-to-1 worldwide”

You are a gobshite.

I don’t understand what profession, degrees or curriculum people lack off to not have basic graps on market development and consumer behaviours rules. It’s not about being impatient, it’s about the fact that you can kiss VR good bye in 2/3 years and wait for another cycle if there’s no “ideal” headset release before. It will NOT pick-up by some random magic, or point, there are marketing adoptions matrices that describe the unfolding of events. Smartphone, laptop, pc, console, music player etc…did not wait 10 years with “less than idea tech”, developing at a “steady pace” for it to be suddenly exactly what it’s supposed to and be mass adopted.

The scenario today is similar to VR in the 90s: amateurs contempt with the somewhat VR they get because Palmer Luckey had a great but incomplete initial idea think that it’ll somehow be adopted on the long-run because “magic” and “these things take time”. It can be compared to Palm vs iPhone. Palm NEVER picked up or would because they shit non-sense products, while the iPhone is exactly what it’s supposed to be and therefor it has sold 3 billions in 10 years. Oculus/Vive/Gear are Palms that are going nowhere unless there’s a boost on the conception of what a VR headset is supposed to be.

To each device it’s success story. But let’s take the most contemporary (because current market rules apply even harder and faster) and best exemple: the iPhone.

When Palm were released, they’ve always been a failure adopted by a range of corporate people because it was the only portable thing that took note and read emails. It never picked-up and ruined the Palm company until it completely disappear under the PDA form. Because it was crap, I hope I don’t have to describe that.

Then in 2007, the first iPhone is realeased, costs 600$ yet sold 6 millions devices, and in barely 9 years it’s now found in the pocket of 3 billions users which is huge. Is it magic? Did they “wait” for it to “steadily grow” we don’t how or where, with a random and unlimited amount of time because people would just be “patient”? Nope, but why?

Because what is smartphone today? It’s exactly, semantically, word by word: a mobile connected computing interface operated through a wide multi-touch screen in a pocket-sized slate. What was an iPhone 10 years ago? A mobile connected etc…pocket-size slate. The iPhone was conceived “perfectly” from the day of release and this is the ONLY reason why it’s successful. It could have taken 2/3 years if it wasn’t from the get go although it means it wouldn’t have reach it’s current stated and critical size market yet, but only if it became this “perfect” device that make sense before the momentum window closes and people are just dubbing the iPhone a useless gadget.

Well, VR headset have been around for 4 years now, NO LESS, EVERYONE I know invested in VR was already aware or had one, the problem is that from the initial but incomplete great idea from Palmer Luckey which was to use one of those smartphone screen with DOF sensors and lenses, these headset haven’t evolve and currently they are “Palms”. So the point I’m making unless you’re a science denier is that unless it become a “perfect” device that makes sense for what it’s supposed to be (wireless, 3 second put-on/away design and most importantly integrates the single component that suddenly inside-out body/motion/head tracking, environment tracking, hand interaction, and most importantly see-through AR and it’s millions of capabilities potential) by late 2018, then VR is dead for this cycle and dubbed yet another fad because that’s how market and consumer laws work.

Okay let’s argue semantics (which are important): either there was NO smartphone before the iPhone, or the iPhone and all subsequent smartphone are something else even though they’re called as such.

What Wikipedia calls smartphone was simply one those teen flip-phones with a tiny LCD screen that had the first internet service (almost working like a Minitel). This is NOT a smartphone but if you will a proto-smartphone. But maybe we can take it the other way around: this was the first smart-phone- and the iPhone simply is something so beyond that it shouldn’t even have that name retrospectively and be called a pPC like a pocket-personal-computer or a smartoperator.

My point is there was NO smartphone as we mean it today, before the iPhone. But you’re right it didn’t get there suddenly, like any technology, science or even philosophy, there was other technology prior to that. But the FIRST smartphone that is the iPhone was “perfect”, as I described it’s definition hasn’t change in 10 years because it was already what it’s supposed to be to make sense, and because it was such from the beginning it sold 6 millions first year and now 3 billions.

This is a unique exemple of something “perfect” right away, because Steve Jobs. But my main point is that VR right now, doesn’t make sense as it is and will NEVER pick-up as such, because it’s not a real product (and it took me time after fiddling with all the headset to realise this). Now obviously the direction towards such a product is here: TPCast and the Oculus prototype show that they’ve understood the essentiality of wireless, Tango and Intel RealSense show that they know the solution has to be an inside-out tracker, the PSVR design recently adopted by LG shows they’ve understand that this design cue is important.

But we don’t have have 10 years, no market, especially this one, works like this. In fact we’re underestimating how bad the initial sales of VR headsets (high-end) are. Even my internal (in-agency) sale projections were a bit off although I’m very good for such product with a bit of pessimistic tendency (obviously) yet, I though the Oculus would at least sell 200k and Vive would 300k which was already low and far from the hysterical “analysts” projections. And in fact, that’s what the core of prediction is about: it’s not about signals matrice numbers or abstract marketing matrices, it’s about the product and it’s sense. With the way VR headset were conceived then prices, there was NO way they sell more than a few 100k, yet lots of people in the industry are work by “hopefull magic” because maybe if we’re super optimistic and hypocrite this will suddenly convince millions of people.

So my underlaying fear is about the fact that if VR, that has been around in terms of consumer “rumours” for at least ” years, and as a consumer market for a year and half, people won’t wait for another 3 years for a first VR headset that makes sense and people will want to buy and more importantly use like they casually use any other devices…and you’re right that these takes time: AR or inside-out tracked VR are the main and biggest point of these headset and the technology is complex to develop. So why isn’t there any Tango Daydream out there yet, why and how are the RealSense Windows headset, why didn’t Oculus and Vive iterate shit from the original DK1 and are not already wireless and inside-out tracker (meaning hand interactions amongst other thing)?

1. You misunderstood my point because we disagree on this: the Palm is NOT a step towards the iPhone. that would be like saying drones are step from a 70s remote toy car or an iPad is a step after the calculator.

There are 2 different products, one that never took off, had the chance in it’s market to stall until it completely fail, the other is a completely new kind of product, that worked right away because it was perfectly conceived. It’s both a question of time (or context if you will) and initial conception of the product at the core of it, which is why the Super Nintendo was super successful from the get-go and the Wii U miserably failed despite being release well after the first consoles.

So in other terms, if the iPhone was released with somewhat reduced screen sized, with no camera or not tactile screen and had to be constantly plugged to a wall to be powered or operate, and need to be kept in bag, have to be strapped on the hand…it’s exactly what VR Headset right now, why they don’t make sense as consumer products and will never pick-up in that state. And if anything, hopefully in 2 years (because beyond that it means VR will have failed, become a fad and investment will fall) we will laugh at how far from an actual usable and practical VR headset the first consumer version were.

Now the second point I seem to have trouble passing through is that: if the iPhone had to wait in that state for more than 2/3 years it would’ve been abandoned, if the first Parrot drones were conceived in a way that they’re like new remote helicopter toys but you can control them with your smartphone except they don’t have quadcopter stabilisation and cameras (which was the whole point of it), this company would have failed etc…simply because with a paradigm shifting technology such as VR that has already been there and failed in the 90s, then has been there again for 4 years now and garnered so much hype because of an abstract potential everybody states but are unable to rationalise, explain or describe, if people who use VR and let their GearVR or CV1 take the dust after a few month of usage (which is the case of almost allo my VR-equipped colleague even those currently on project production), including our clients, and those who tried one, were impressed but never were further invested for the same reasons as us and no headset is appealing enough to use it, and overall people who have heard about VR, maybe tried it but then no further so any incentive or interest in it…there is a timeframe windows until that interest and attention completely wanes out, and the more time goes forward the less people are impressed even if you just bring the same Vive, with the same bulky design and external tracking, just being “wireless” is not going to convinced the millions more people necessary to jump start any contemporary device market.

2. And that’s why I judge VR by the same market and consumer behaviour rules that apply today but in a context that is way faster and harder. What you may see as breathtaking advancements makes for me no more sense that it did in the 90s (well a bit more, but nowhere enough to call that a real device product). And price has never been a factor, the first iPhone, again the best exemple, cost 600$ (700€) and still sold 6 millions and exploded in sales even though price grew. People buy incredibly expensive commodities even in clothing, because the perceived value matches the thigh price. VR is NOT expensive, it’s simply a badly conceived product which is why nobody is buying it, and worse those wealthy enough to buy it because it’s a cool house cocktail gadget leave it dusting on the shelves after a few month everywhere I look…

So before being about price or even time, it really is about the fact that as impressive VR HMDs might look like from amateur point-of-view, and god was I impressed when I first tried the Unreal living room coaster and then Senza Penzo (way more impressive than basic Oculus/Vive demo today)…but then taking a step back, and another one, and a few more to observe, analyse and rationalise what is VR, how it is made and how the market work, I can simply state: VR HMDs is even not a real, practical and usable device the way it should be yet, and that alone means it’ll not pick-up. And then as I explain, with all the investment, buzz, momentum interest in it, people won’t wait beyond 3 years more for it to be an actual product, which as I stated for the iPhone, doesn’t have to ultimate in it’s functionalities, specs or quality, but has to be a “perfectly” conceive product that make sense for what it’s supposed to be and do.

Well the first iPhone was “perfect” in it’s conception which is why it sold 6 millions at 600$, not 200k, but it was imperfect in configuration, optimisation and precise defining. It’s true. But the first generation of VR HMDs, which again barely iterated from the original DK1 is FAR from being even a basic conception of what VR is supposed to be.

Here’s how we followed the thing in my agency: the DK2 was impressive and fun, and wow Senza Penzo (where are the other Senza Penzo’s btw…?) but eventually by rationalising what VR “is” and thus how it should be to be an actual practical everyday product like any other device people use, in order to sell budgets for experiences or ads and convince people, we realise that the idea of VR is so familiar yet abstract that very few people rationalise or can explain what VR is, thus how it should be. And when the final consumer version were announced, we had our sale projection and we were almost on point: because of the way VR HMDs were conceived and spec’d, it simply would sell as little as the product makes sense for people to buy.

And the conclusion was: obviously VR HMDs should NEVER have cables, a head mounted device projecting you in a virtual space should NOT be tethered, it should NOT have a strap that makes it so daunting to put and use because when you’re going to use a device nowadays and repeat the movement thousands of time, it should take more than 3 step of a few seconds (like opening your laptop lead, pushing your PS4 controller button to get it out of pause, take your smartphone out of the pocket and unlock it etc…), but more importantly it is imperative for it to not only be untethered, from cable or machine but also additional component like external tracker, for it not to occlude your environment which nobody wants to work with or play more than a few hours, which should never use anything that your hand and maybe a small remote because being immerse in a virtual environment but having your hands reach into the real world stumbling in the dark to find a controller or keyboard etc…means it should have had an inside-out tracker like Leap or Tango or RealSense from the beginning.

The fact that people are PC-illiterate, that it cost 700$ which they have no problem spending for smartphone or clothes, or it doesn’t have demos should NOT be factors in consumer device adoption. In fact that’s why the GearVR far outsold the other HMDs although being inferior: it’s not about the price, people still bought a 700$ smartphone with it. It’s because the complete untetethering, portability and versatility of a smartphone far outweights the supposedly more advance or powerful capabilities of Oculus/Vive that are a heavy, strapped, tethered, unoptimised nightmare…

So do I think they are going to close shop? I don’t think I do my job which is to ponderate the different prospective scenarios, or rather the probability between one hand and the other, which despite my feeling or wishes are government by very mechanical causalities based on always proven market, consumer behavior and conception rules. Again, the Virtual Boy which was crap still sold 770k in less than a year and it was 20 years ago, the iPhone which was a perfect conception sold 6 millions in it’s first year, the iPad which is good but a lesser conception sold 15 millions because it was way beyond any other tablet or slate devices, Palm never sold more than 100K per model because it’s crap, the Wii U barely sold 14 millions in 4 years because from the get go it was badly conceive (another on point projection we made in the previous agency I work in, again because the initial conception told us everything we need to know about how people are going to react, in the fact the Switch is going to sell way more for exemple, but maybe not even beyond the 3DS if it doesn’t get a few things right along the way). It’s the same for VR: the way they’re conceive initially bounds their faith by rules of the market and people’s inconscious cognitive reactions to the sense the way these device conception translate in real life use and presence.

2016 was already the big year of VR which was featured in every magasine, if this year despite the many VR “saloons” and fun gadget like there was numerous in the 90s we don’t have a product that is an assured break-through which millions of people are going to want to buy and use, the momentum and attention span will already have greatly reduced, and beyond that companies and brands will simply disinvest because that’s how market work, and no magic PR bullshit like those people who pretended with irrealistic numbers that it would sell 100 millions the first year, then finally 1 millions per devices, but finally barely 150k, is going to change that if their simply is not VR headset conceived the way it makes sense for the majority of people to adopt. But we’re getting there (TPCast, Tango, Real-Sense, PSVR design etc…) it’s just a matter of when and on-time….

Well to me the probability is 50/50. I hope that by 2018 we will have at least one mobile VR headset integrating Tango Daydream which simultaneously adds the capability for inside-out environment tracking, and so see-through AR and it’s millions of capabilities, object tracking (which means object scanning, surrogate, using a keyboard in VR by mapping the key even if it’s off etc…) and so motion, head and body tracking, as well has hand (and voice) interaction etc…then if there’s a PSVR-like foldable design, and an integrated TPCast WirelessHD or Wifiad component for cross-device pairing (because VR Headset are not supposed to be computing device, just visual and interactional devices that replaces screen+keyboard/controller+mic/camera). That’s the only way a Virtual Headset makes sense as a consumer or pro device that has practicality and use.

So we’re really not far from that, but somehow manufacturer are finding excuses and have been finding excuses since the crescent bay prototype, and what I can tabulate is that late 2018 really is the limit past which the whole market, industry and consumer interest will have waned.